Electronic Auctions have become commonplace with the many Auction portals deployed on the Web. Many Auction portals such as eBay, Yahoo, or uBid provide auction models for assisting sellers of large supplies of an item. eBay, for example, offers a “Dutch” Auction wherein the top N bidders will win the N quantity of a good for sale at auction.
A well-known drawback of common auction selling, in particular large or infinite supply selling is that often not all of a supply is sold. This often leaves the seller with inventory that he does not want. Meanwhile, many purchasers may have come to the auction posting and not bothered to bid because the starting bid price was a little or a lot too high for them. However, many potential purchasers would have bid if the price were even just a small amount less. The seller has no way of knowing that he could have sold more inventory if the price was lowered only a little.
The failure to sell inventory is even more interesting when the good being sold may be easily copied and/or downloaded an infinite number of times electronically. In this infinite supply case, the flexibility to drop the price on the good is much greater since copying bits is all that needs to be performed. The seller would definitely like to know what lower prices purchasers were willing to pay and make an intelligent decision on whether or not to let more copies be purchased and downloaded. While the profit on each additional copy sold is the price offered, the seller must balance this lowered price with the fact that word will spread that the electronic good was obtainable at the lowered prices. Similar decision processes are available to the large supplier of real goods as well. However, the decision and the timing of it is up to the seller. Current auction software apparatuses do not provide the means to determine what lower bidders would have been willing to pay. As a result, the seller has to guess what minimum price to set on a new auction, without any useful potential buyer information, in order to dump the rest of their inventory.
In light of the above, there is a need for methods and apparatus in an auction selling environment for the means to determine what purchasers would pay for a good even when they do not agree to the current minimum price. This will provide a greater opportunity for sellers to dispose of more inventory and allow them to decide on exactly which specific lower prices make sense for the seller.